Structural holes in Guanxi networks: Do they increase employee turnover in the People's Republic of China?

This project explores the role of social networks for retaining employees in the People's Republic of China. Organizational researchers have primarily explored the turnover phenomenon in Anglo-American societies and have rarely considered how social networks impact quits (focusing on employees' direct ties to current or former colleagues). To advance knowledge in both areas, this study scrutinizes the density of connections among an employee's network of contacts in Chinese organizations and how firm culture moderates the loyalty-inducing effects of closed networks. From four high tech firms, we collected network data from 417 employees. Regression analyses showed that employees enmeshed in highly embedded social networks where they are tied to colleagues who are tied to each other are more prone to stay. Moreover, we found that network closure effects are stronger in high-commitment firms, where constrained networks more effectively retain incumbents. These findings advance the emerging international literature in turnover as well as social network effects on turnover.